Construction industry feels Covid-19 pinch
Players in the construction industry are expressing worry that a prolonged Covid-19 pandemic situation would bring the business to its knees as they are already counting losses due to unplanned extended periods of project implementation.
Malawian Building Contractors and Allied Trade Association (Mabucata) president Wickly Mhango said in an interview that implementation of various projects is at a snail’s pace due to the Covid-19 pandemic.
He said a good number of projects were already awarded while others were in progress before Covid-19 started hence they are compelled to continue working with a few people on site to be within the project deadlines stipulated in their contractual obligations.
Said Mhango: “When government announced the lockdown, it ordered reduced number of workers at a time, government also ordered that we establish quarantine facilities and procurement of Personal Protective Equipment [PPE], things which were not in our budgets.
“As we speak, contractors cannot import some key project materials due to the lockdown which has greatly suffocated the performance. Many contractors have transferred their profits into maintaining the projects which they are implementing hence ending up with little or no profits at all.”
He also complained that some officers who are responsible for payments in both public and private sectors have stopped working due to Covid-19 which has also affected performance of the project funds.
The association observed that Covid-19 has affected everybody so the consensus is that contractors cannot transfer project costs incurred due to the delays to the owners because it was not part of the agreement.
“Prices for materials found locally have risen due to scarcity as imports are not possible hence project costs keep rising,” he said.
National Construction Industry Council (NCIC) chief executive officer Linda Phiri earlier said her institution was working with contractors to ensure Covid-19 pandemic mitigation measures are adhered to.
Latest figures released by the Reserve Bank of Malawi (RBM) show that growth in the construction sector is estimated to slowdown to 3.7 percent in 2020 compared to an estimate of 5.8 percent for 2019.
The central bank attributed the slump in growth on account of slowdown in implementation of various projects following disruption of supply of imported materials due to lock-down in trading partner countries.
“These projects were expected to shore up growth of the sector. In 2021, the sector is projected to grow by 4.2 percent owing to recovery in multiple construction projects,” said RBM Governor Dalitso Kabambe.
